In order to achieve its ambitious goal to become a $10 billion company, under armour knows it will need to develop into a footwear powerhouse.
In the event you pass the company’s last earnings report, that initiative is performing great. Footwear sales over the last quarter of 2016 were up 36%, in accordance with the company’s own metrics.
But that number doesn’t tell the complete story. According to another number by industry analysts at NPD Group, the sales of Under Armour’s footwear actually fell 20% in that same period.
These numbers are generally accurate. How is possible? Under Armour’s number includes sales straight to customers as well as sales to wholesalers, because the FEC requires, as the NPD number measures actual sales to consumers.
The discrepancy is explained by the fact that under armour outlet australia sold a whole lot of shoes to retailers, but those retailers couldn’t move them. It means inventory accumulated, causing trouble for retailers and necessitating discounting, industry analyst Robin Lewis writes on his website The Robin Report.
That’s not great news for Under Armour’s star-powered footwear business, that has seen sluggish rise in its models endorsed by all-star basketball player Steph Curry. Basketball footwear sales industry-wide were down about 20% in 2016.
The athletic shoe industry by and large has shifted to lifestyle and retro styles, that under armour outlet melbourne has limited offerings. NPD analyst Matt Powell called retro styles “the 15dexjpky player from the athletic footwear market” growing at 29% through October of 2016. Unlike Adidas and Nike, Under Armour does not have decades of footwear styles to draw inspiration from and it has virtually nothing to offer with this category.
Under Armour by and large is shifting strategy right after a disappointing quarter, admitting it missed the athleisure trend.